Hot market: Integra Shores apartments sold for $32.2 million

Entrepreneur Grant Cardone, host and producer of National Geographic Channel's reality TV show Turnaround King, has cannon-balled into the local real estate pool.

BOB KOSLOWBUSINESS WRITER

DAYTONA BEACH — Entrepreneur Grant Cardone, host and producer of the reality TV show Turnaround King, has cannon-balled into the local real estate pool. The 54-year-old author, motivational speaker and real estate investor has paid $32.2 million for the 288-unit Integra Shores luxury apartment complex built in 2008 at the northeast corner of Clyde Morris Boulevard and Strickland Range Road. "This is our first entry into the Daytona Beach market," Cardone said Thursday. "I know a few businesses in the area doing well." He said economic factors often improve before any reports come out reflecting the improvements. "We are seeing trickles of success." Local real estate watcher Claude Gardner, managing director of Prudential Commercial Real Estate FL in Daytona Beach, said the $32.2 million sale price, reflecting more than $111,000 a unit, was high for the market, but said he did not know the rent rates that might justify the price. "Apartments are the darling right now," Gardener said. "If an investor can get 5.5 to 6 percent return, that's good considering the alternatives." Several apartment sales the past year across Volusia and Flagler counties had per-unit sale prices in the $50,000 to $60,000 range, but those were mostly older and smaller complexes. On the other hand, August's $47 million sale of the newly built Andros Isle apartment complex in Daytona Beach was $130,555 per unit. Cardone, meanwhile, is bullish on Florida in general, having recently moved to Miami Beach after 20 years in California. Through his Pacific Start 5 Inc. real estate company, Cardone has bought six Florida apartment complexes in the past 30 days worth $90 million. Others are in Stuart, Palm Bay and Port St. Lucie. "I love the Florida story," he said. "It's a magnet for the Northeast population explosion. People are drifting here again, unsatisfied with the Carolinas. There's also the push up from Latin America." No income tax, no new apartment complexes under construction, a business-friendly Florida governor, frozen mortgage lending and a shattering of the American home ownership dream are other reasons Cardone mentioned for his aggressive investments in Florida apartments. "There are 76 million Gen Y's and even more baby boomers who do not want homeownership. The Millennials saw parents lose homes to foreclosures and they just want a place to hang out and meet people without the bothers of owning it. The baby boomers retiring do not want to be bothered with mowing yards and that," Cardone said. "There are millions of people who lost homes to foreclosure and can't buy a new home for seven years. They have to live somewhere." Lake Mary-based Integra Land Company constructed Integra Shores with one-, two- and three-bedroom units in eight buildings on 13 acres. The sale was good timing for the company and partners, company President David McDaniel said. "We put it on the market about six months ago and think it's a fair price for what we put into it," he said. "The environment has changed since we built it and we held on to it a bit longer than usual. We had to be competitive with rates early on, but we have been making headway since." McDaniel agreed that Integra Shores was built to be a high-middle to upper-end complex. He also said there are no plans now to sell Integra Landings at Ivey's Lake in Orange City or the Integra Woods complex in Palm Coast. Cardone said he also was drawn to Integra Shores' 98 percent occupancy rate, its location near the new Florida Hospital Memorial Medical Center and a growing healthcare field. "Apartments will prove to be the single best investment in the next decade," Cardone said.